You’ve built an income plan. Your investments are aligned with that plan. On paper, retirement may look pretty solid.
But there’s another part of the plan that’s easy to overlook: taxes.
At Kennedy Financial Group, Manage Your Taxes is the third phase of our Guided Retirement Roadmap, and it’s an area where we believe being proactive can make a meaningful difference.
Because when it comes to retirement taxes, the deck can sometimes feel stacked against you.
Your IRA Has a Silent Partner
Imagine you’re 60 years old with $1 million in a traditional IRA. It’s easy to look at that statement and think, “I have a million dollars for retirement.”
But that IRA has a silent partner: the IRS. That account may grow for decades, and as money comes out, those distributions will generally be taxable as income.
For some households, over a long retirement, that can add up to a very large tax bill — potentially hundreds of thousands of dollars, sometimes more. That’s not a prediction or a promise. It’s simply meant to highlight the scale of the issue.
Tax Prep Isn’t Tax Planning
Every year you file a tax return. That’s tax preparation. It’s important, but it’s mostly backward-looking.
Tax planning asks a different question: Given the plan we’ve built, are there moves we should at least evaluate now that could improve flexibility later?
For example, there may be years when your income is temporarily lower or years before required minimum distributions begin. Those years might present planning opportunities worth discussing.
Things That Often Catch People Off Guard
Required minimum distributions don’t ask whether you need the income. Medicare premiums through IRMAA can increase when income crosses certain thresholds. Tax rates and rules can change.
You don’t need to memorize all of that, but it’s part of why tax strategy isn’t just a one-time decision.
Depending on an individual’s circumstances, strategies worth evaluating may include Roth conversions, qualified charitable distributions, donor-advised funds, and other tax-aware planning techniques.
Proactive, Not Predictive
We don’t know future tax rates. We don’t know future laws. And we can’t guarantee outcomes.
What we can do is help you make informed decisions while options are still available and adjust when life or the rules change.
You’ve spent decades building your savings. Managing taxes is about being just as intentional about how that money comes out — building an income plan designed for tax-aware withdrawals, avoiding unnecessary surprises, and considering tax-smart strategies when they fit your plan.
Disclaimer
This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax advice. You should consult with your tax advisor for guidance on your specific situation.
